Stenger settles with SEC - VTDigger
 

Stenger settles with SEC

Bill Stenger, the CEO and president of Jay Peak Resort, has partially settled with the Securities and Exchange Commission.

The SEC alleged in April that Stenger made material misrepresentations to defraud 700 immigrant investors from 74 countries in an effort to allegedly aid and abet his business partner, Ariel Quiros, in a “Ponzi-like” scheme.

The violations alleged in the SEC complaint ranged from diverting funds from one project to another, misstating revenue projections and failing to make required contributions to developments.

The actions, according to the complaint, put EB-5 investors, who each contributed $500,000 plus a $50,000 administrative fee, at risk of losing money as well as their eligibility for U.S. citizenship.

Under the agreement, Stenger cannot admit or deny allegations that he violated securities laws in the agreement with the SEC.

The permanent injunction bars Stenger from participating in the EB-5 program.

Stenger adamantly denied any culpability immediately after federal and state regulators brought charges against him in April.

In a statement on Thursday evening, Stenger said the settlement “sets up a framework to fully resolve the case the SEC filed against me.”

“I also have been fully cooperating with the Receiver since his appointment,” Stenger said.

The former CEO of Jay Peak has agreed to cooperate with Michael Goldberg, the SEC receiver, as part of the case against Quiros and could testify against the Miami businessman in a future civil trial.

Stenger said he will no longer speak to the press. “Based upon the terms of the settlement, this is all I can say and will be saying,” Stenger said. “I ask that you please respect that I will not be making any more public statements about the settlement nor about the case. I want to focus my efforts fully to assist the Receiver and to help the investors.”

A civil penalty may be levied at a future date, depending on Stenger’s ability to pay and his level of cooperation.

The state has also charged Stenger with making material misrepresentations to investors. A resolution in that case has not yet been reached. The U.S. Attorney is also investigating possible criminal charges associated with the Jay Peak case.

Anne Galloway

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  • christopher hamilton

    It’s a bad day to be Ariel Quiros.
    Really bad.

  • Doug Hoffer

    If you rob a 7-11, you may go to jail. If you participate in the largest fraud in Vermont history, you get to pay a fine and avoid accountability. I’m sorry Mr. Stenger, but why should we “respect that [you] will not be making any more public statements about the settlement nor about the case?” Shameful.

    • “If you rob a 7-11, you may go to jail. If you participate in the largest fraud in Vermont history, you get to pay a fine and avoid accountability. ”

      Exactly Doug, and our elected officials wonder why people are so cynical of government! The investigation should also involve those in charge of regulating EB-5 program that obviously didn’t perform their duties (i.e.no audits) and were negligent numerous times over the years, even when they were alerted to charges of fraud. After all Stenger and Quiros weren’t operating in a vacuum.

    • John McClaughry

      Hoffer is charging Stenger with “the largest fraud in Vermont history”. That’s a serious criminal charge. I wonder what Hoffer knows that the SEC didn’t know when it decided not to prosecute. When an elected official charges a man with a crime, he had better be able to make it stick – especially when Stenger still faces Vermont charges..

      • Would seems to be “the largest fraud in Vermont history” be preferable? And then we have the last paragraph:
        “The state has also charged Stenger with making material misrepresentations to investors. A resolution in that case has not yet been reached. The U.S. Attorney is also investigating possible criminal charges associated with the Jay Peak case.”
        The “shoe” has just begin to fall.

      • Doug Hoffer

        Absurd. First, I didn’t “charge” him with anything. I said he participated in the fraud. Based on the known facts, how can you possibly deny that? Second, people with no involvement don’t usually settle such cases.

        • John McClaughry

          No doubt Stenger participated in whatever Jay Peak did. If/when he comes to trial, I can imagine his lawyer objecting to jury prejudice because the Vermont State Auditor of Accounts proclaimed the defendant to be guilty of fraud, on the widely read Vermont Digger. If you’re a high level elected official, you need to think twice before you say things like that.

      • That sounds like the FBI’s explanation for Ms Clinton.

    • What Fine is he paying?

  • Billy you have not been speaking to the press anyways… I feel like billy is being treated like a child who spilt his milk “it’s ok Billy, just don’t do it again!” Unreal!!
    Will Vermont or the U.S Attorney hold billy accountable or act like he is a little child and sit him in timeout till he says sorry I won’t do it again!!

  • If I read the first couple paragraphs correctly Stenger refuted culpability with the statement “sets up a framework to fully resolve the case the SEC filed against me.” just prior to asking for respect….so I respect him for becoming so involved with an apparent sleaze the likes of Bernie Madoff and finding a way to out-do him. Is that adequately appropriate due “respect”?
    Wow…talk about breaking your word to the SEC on Day 1 there “Billy”!! Is that like a little bit pregnant???

  • Benedict Gomez

    It’s pretty obvious that Stenger is telling the SEC everything just short of what Quiros likes to eat for breakfast.

  • John Molnar

    Can you say “rolled over”? No jail time for this con man?

  • It could be possible that he was just as blinded by all that capital influx as getting off the tram on an early winter day when the sun’s just breaking through cloud banks on the eastern horizon. It seems slightly more possible that the sun’s dropping like a rock for Mr. Q. in what may be the biggest plea and ski deal ever cut in the state’s history.

    Either way, both Burke and Jay now face new challenges because the sheer operating costs at Jay (in energy alone) are going to take constant $ influx, and Burke’s new hotel seemingly far exceeds it’s skier draw that has hampered that area as much as it’s typically lower snowfall. I predict another fire sale there, because there’s no way the cost/income of the new Burke hotel (essentially located in Northeast No-where) will viably or profitably pull that many skiers further north. One good recession or bad winter and it’s trouble time once again and that Mtn. historically alternates between both! Might be some great Liftopia deals!!

  • Steve Joyce

    Yeah why hold Billy accountable for his actions……good example for the youth of the NEK…….if you are going to be a crook, make sure you are the second dirtiest person in a really big scheme so you can roll over on the other guy and get away with your crimes.

    Can they finally yank his company position, company condo and company Audi now?

    We all know he was in on the bulk of the fraud, if he truly didn’t know what was going on, he is monumentally ignorant at historical proportions at the very best. And I find that very hard to believe.

    Hopefully the Q’s along with some of the other periphery folks involved in the fraud will be held accountable based on his testimony; that is the only upside I see from this “settlement”.

    Anne, awesome job as usual.

  • George Willy

    The SEC ought to file charges and fines against those in government that guaranteed oversight of the EB-5 program to the investors and to the public, and failed miserably to do so. Same-o Same -o.

    • Hey Look, A couple state government employees voted Thumps down.

  • What a heartbreaking day for the NEK. Reading this, and hearing that SEC may go “easy” on Bill Stenger because he’s cooperating is demoralizing to me. I am from a generational family who believed in “Raise ’em Jay”, and have lived in the NEK my entire life. VT digger has done an imposing job at revealing the facts of this fraud. To hear that Stenger is going to settle and not be held accountable is offensive to the NEK community.

    My faith and reliance on VT Digger’s investigative reporting seems to be our only hope in exposing the truth and having any chance of morality and justice.

    • Hence the need for a rigorous “fourth estate.” No wonder why some of the rich and powerful dislike the press. Unfortunately such investigative reporting has be neutered to a great extent. We need more such “muckrakers” in the media. Many of the social reforms that we take for granted today would not exist if it wasn’t for news organizations like Digger.

  • John McClaughry

    Let’s see: after announcing with great fanfare that it was throwing the kitchen sink at Stenger, the SEC has now reached an agreement where it will stop charging Stenger with committing fraud, if Stenger will agree to stop claiming he is innocent of committing fraud. Hmmmmm…

  • Paul Carnahan

    Everyone is missing the fact that the SEC has announced nothing. This is a PR ploy by Mr. Stranger.

  • Reminds me of the Tom Jones song “I’m not Responsible”

    This is the “Justice System” these days….Everything around him went and was wrong but Bill didn’t do anything wrong and doesn’t remember doing anything wrong. Great message for our youth.
    If Stenger was an Oil, Insurance, or Health Care company he’d be tarred and feathered. But because he can blow the whistle on Leahy, Bernie, Shumlin, and the rest of the crooked State hacks, he is let off the hook.
    I wonder if he has the same attorney as Hillary?

  • Steve Merrill

    Somebody please take back his white hard hat and rolls of “artist renderings” before he does it again! Too bad we don’t have “stocks” or community dunking stools anymore. He toots the horn, the Green-Carders come running, he then clams up but rolls on his “partner”? So that makes him a liar, a fraudster, and thief, and now a snitch, no? His “punishment”? A $2,000 a week check for as long as he likes, or until Goldberg “wraps up” things? Now THAT’s the system working hard to “protect” us! Wonderful…SM, N.Troy.

  • Deborah Billado

    What… No jail time. Seems like it’s becoming the thing to lie and cheat and deceive people with no threat of prison. Our country has really taken a turn for the worse.

    • It seems that the SEC, a federal agency, is leading this investigation. I don’t believe that they have the authority to bring criminal charges. The evidence they gather, however, can be used in conjunction with other agencies, state and federal, that have begun their work. I think that criminal charges will be coming along soon. In reading the text of the deal Stenger made with the SEC, it seems that the arrangement allows for additional civil, as well as criminal charges. The penalties so far do seem quite minor. Future penalties that the SEC will impose are base on just how cooperative Stenger continues to be. I definitely agree with you that, in the end, much more devastating civil and criminal charges should prevail, but there has to be some consideration for his cooperation, as distasteful as that is.

      • Linda Quackenush

        SEC can make a recommendation to VT US Attorney Eric Miller. However, I highly doubt there will be any criminal charges as Barack Obama appointed Miller. Unfortunately this is how crony justice works~

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